Why secured loans, or homeowner loans if you wish, have such favourable rates of interest is because they are secured on an collateral, meaning that it is certain that, at least some time or another, the lender will be total sure of receiving payment for the loan that he has lent.

Secured residential loans are guaranteed by collateral which is the property of the person applying for the loan.

As the interest rates for these homeowner loans are good, this is what makes them a superb means for homeowners to obtain money whenever they need it.

Rates can vary depending not only on whatever lender is being used but they also vary depending on equity, credit rating , and factors such as if the borrower is employed or self employed.

Pre recession it was possible for a homeowner to obtain a secured loan at almost as low a rate as a mortgage or a remortgage, at less than 6% APR.

These 125% secured loans had interest rates of 11.9% if the homeowner had been at his property for twelve months, and normally from 12.9% for those who had lived there for only six months.

This current rate is still fairly cheap and another advantage is homeowner loans can be used for just about anything and with repayment periods of up to twenty five years, they are a very good loan indeed

Even homeowners with low credit ratings can get secured loans but at a higher rate of interest and with a maximum LTV of 60%, and with this plan unlimited adverse credit is accepted and the rates are about 25%.

However, this is the only means for some one with a really bad credit to obtain a loan, and eventually if the borrower pays the loan regularly it will increase his credit rating which means that he can apply for loans with better rates of interest

However for those labouring with the worry of debt, it is a great method of obtaining money that can be used for almost any purpose, including debt consolidation that combines all their credit into one.

Secured loans of all rates, also make good debt consolidation loans that lump all credit into one manageable monthly payment.

Want to find out more about secured loans then visit Champion Finance’s site on how to choose the best self employed loans for you.